Tweak Your Biz » Sales » Procurement – Friend or Foe (Part I)

Procurement – Friend or Foe (Part I)



Amongst senior sales professionals, the word “procurement” typically brings an emotive response, usually in the negative. There are two reasons for this;

1. Sales professionals do not understand the role of procurement within their organisation and the internal challenges that procurement face with their own business stakeholders.

2. There is a great variance in the professional capability of procurement professionals in the Irish market in particular and a lack of awareness amongst senior sales professionals how to recognise the role procurement managers play within the target organisation. This is a contentious point but a very valid one.

On the first point, it is important to understand that procurement grapple with an ongoing challenge to prove their personal value to the business. From experience I advocate engaging with Procurement at the outset as a very useful strategy. This is because capable procurement managers will always look for new innovative ways from suppliers to bring enhanced value to the business (and budget holders). They are primarily compensated on cost savings but delivering increased value and lower cost on a sustained basis is what maintains and increases their value to the business.

On the second point, bear in mind that procurement managers are not all the same. Some procurement managers are only brought in at the end of the sales cycle as a matter of policy to extract lower pricing from you and it is important to recognise these tactical practices. As a general rule the level of sophistication of procurement usually drives how early the business get them involved. By engaging early in the sales cycle with procurement or even when there is no sales cycle in place, this enables you to decide on the most appropriate sales strategy to adopt with Procurement.

There are different approaches and strategies I have adopted over time to ensure the most successful outcome, but the main advice I would give is to clearly understand the role procurement play within their organisation as early as possible in the sales cycle. You may be surprised to know that procurement can be of assistance in some organisations to position new solutions to the business.



The Author:

With over 16 years experience in the technology and financial services industries, Ronan has a unique combination of solution selling and procurement knowledge. With a career which has spanned sales, marketing, consultancy and corporate banking, Ronan has extensive experience in new business development and global account management roles across multiple industries internationally. http://www.supplierforce.com

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  • Anonymous

    Hi,

    Good article, would be interested to hear more. things that I would like to know more about are:

    Creating a community experience.
    Attracting the community and earning their respect for your brand.

    Cheers,

    Joe

  • http://www.yaboya.com/ Paul McAvinchey

    Thanks Joe. Looking forward to looking further into this with you.

    Paul

  • http://www.sianphillips.ie Sian Phillips

    Great blog post Gerard. Thankfully this was something that my financial advisor brother advised Barbara and myself when we became partners in Whatswhat.ie. We took out an insurance then and must admit it does make us rest easy knowing the business and our families are covered in case of anything happening to either of us. I recommend everyone in a partnership to look into this.

  • http://www.btbtraining.com/blog Niall Devitt

    Gerard, great post. This is an important subject but one that few of us like to talk about or consider. In your opinion, is it something that needs to be factored @ the start-up stage (1-3yrs)?

  • http://blog.myprojecttracker.com Barney Austen

    Great post Gerard. Hadn’t even thought about! Assume that this applies to a limited company also where there are two or more principle shareholders. Need to look at this at some point. Cheers.

  • Anonymous

    Niall,

    IMHO it should be done at the outset of setting up the partnership and should form part of any partnership agreement that is in place. I understand that it may be difficult to put a ‘value’ on each partners share at this stage but you would have to be reasonable about it and probably review it every so often. You can always buy more insurance cover at a later date.

    Barney,

    The idea is the same for Company Directors. You can also do this type of transaction for ‘Key Men/Women’ within an organisation as long as the employer can show that they would suffer a financial loss should a ‘Key’ member of the organisation die.

    I hope this helps. If you want to tease it out a bit more, just ask. I may not have all the answers to hand, but I know where to get them :)

  • http://www.channelship.ie/blog/ fred

    Good post Ronan. Welcome to Bloggertone!
    While I was reading your post I could’t stop thinking of the exact same situation that goes on between the Sales and Marketing departments in several companies. These are departments that should definitely work together and feel part of the same team but there’s always seems to be this battle… for no reason.
    Many Marketing department can hugely benefit from valuable feedback provided by sales people at all levels. At the same time, if Marketing explained the goals and the big picture in plain English to the sales guys, everything would be much easier.
    I guess the person in procurement or the Manager is probably the one that needs to make the first move maybe..

    Best
    Fred

  • http://www.btbtraining.com/blog Niall Devitt

    Hi Ronan, Welcome to Bloggertone! I was lucky enough to hear yourself and David Coffey speak about how the procurement process is evolving earlier this year. I have to admit it was one of the most insightful presentations I attended in 09. For two long, salespeople have operated a “them and us” attitude towards procurement managers. I am in full agreement with you that salespeople often “fail to recognise the role procurement managers play within the target organisation” For salespeople to succeed, this is a situation that now needs to change. Great to have you on board and looking forward to the series. Regards, Niall

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